U.S. medical equipment maker Medtronic Inc said it would still purchase Covidien Plc but would use $16 billion in debt rather than cash held overseas, reacting to new U.S. Treasury guidelines designed to cut the benefits of such "inversion deals."The U.S. government has tried to clamp down on deals in which U.S. companies move their headquarters to Ireland and other low-tax countries. New rules are aimed at making it harder for these companies to avoid paying taxes when they use cash held overseas.With more certainty about how Medtronic would respond to the new tax rules, analysts raised their expectations for its shares and dividends. Medtronic stock rose 3.6 percent to $65.06, while Covidien gained 5.6 percent to $93.78.Medtronic in June announced plans to buy Ireland's Covidien for cash and stock worth $43 billion. The company said on Friday that using debt made the transaction more expensive, but the deal would still add to cash earnings in fiscal year 2016 and increase them "significantly" after that.
Covidien Public Limited Company is engaged in the development, manufacture and sale of healthcare products for use in clinical and home settings. Shares of COV traded higher by 5.8% or $5.15/share to $93.96. In the past year, the shares have traded as low as $59.72 and as high as $92.68. On average, 4647600 shares of COV exchange hands on a given day and today's volume is recorded at 16999424.
Medtronic, Inc. (Medtronic) is a medical technology company. Shares of MDT traded higher by 3.66% or $2.3/share to $65.10. In the past year, the shares have traded as low as $52.44 and as high as $67.11. On average, 7843520 shares of MDT exchange hands on a given day and today's volume is recorded at 23890996.
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